The commercialisation of electrochemical advanced oxidation processes (eAOPs) as a method for removing recalcitrant pollutants from wastewater is currently limited due to the potential for the formation of toxic by-products. In this regard, this research comprised a comprehensive optimisation study aimed at finding a balance between minimising the toxicity effects observed via phytotoxicity assays and maximising the eAOP degradation efficiency under low energy requirements. To this end, carbamazepine (CBZ) was selected as the target pollutant in synthetic wastewater, and the operating conditions considered for optimisation were the nature of the anolyte (i.e., sulfate- or chloride-based), its concentration, and the current density applied. Together with the identification of the CBZ transformation products and their estimated toxicity based on the ECOSAR model, the optimum treatment was found to correspond to the degradation in 500 mg L−1 of a sulfate-based anolyte at a current density of 10 A m−2. These conditions led to the fewest and least toxic transformation products and favoured plant growth indices in phytotoxicity tests. Even if additional process improvements are required to reduce effluent toxicity, continuing such a multi-target optimisation approach can lead to innocuous electrochemical wastewater treatment.